Xylem Inc (XYL)

Days of sales outstanding (DSO)

Dec 31, 2024 Sep 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019
Receivables turnover 5.10 4.88 4.84 4.55 4.08 3.65 5.07 5.04 5.24 5.10 5.15 5.45 5.39 5.33 5.26 5.28 5.04 5.18 5.27 5.07
DSO days 71.53 74.79 75.35 80.15 89.36 99.99 71.94 72.44 69.60 71.55 70.81 66.96 67.71 68.44 69.37 69.09 72.49 70.49 69.30 72.04

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.10
= 71.53

Days Sales Outstanding (DSO) is a measure that indicates the average number of days a company takes to collect revenue after a sale has been made. A lower DSO value is generally preferred as it indicates faster collection of receivables and better cash flow management.

Analyzing Xylem Inc's DSO over the period from December 31, 2019, to December 31, 2024, we can observe some fluctuations in the DSO values.

- The DSO ranged from a low of 66.96 days on December 31, 2021, to a high of 99.99 days on June 30, 2023, indicating potential challenges in collecting receivables efficiently during that quarter.
- The DSO values fluctuated between the range of the mid to high sixty days for most periods, suggesting a relatively stable overall trend in collections efficiency.
- There was a significant increase in DSO on June 30, 2023, and September 30, 2023, which could be a red flag indicating potential issues with accounts receivable management during that period.
- The DSO decreased gradually after the peak on June 30, 2023, indicating an improvement in the company's collection efforts.

Overall, the trend in Xylem Inc's DSO suggests that the company has been fairly effective in managing its accounts receivables, with some periods of inefficiencies that need to be addressed to ensure optimal cash flow management. Monitoring DSO over time can help the company identify areas for improvement in its credit and collections processes.